World Inequality Report 2022

26.05.23

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Mains Examination: General Studies 3

(Economy: Dimensions and Alleviation of Poverty)

In News:            

• Recently, according to the World Inequality Report 2022 released by World Inequality Lab, India is among the most unequal countries in the world.

World Inequality Report 2022

Key Points:

• According to this report, the poorest half of the world's population owns only 2 percent of the total wealth, while the richest 10 percent of the world's population owns 76 percent of the total wealth.
• The Middle East and North Africa are the world's most unequal regions, while Europe has the lowest levels of inequality.
• Women's share of total earnings from work was around 30 per cent in 1990, which is now less than 35 per cent.
• The gap between the average income of the highest-income 10 percent and the lowest-income 50 percent of people in countries has almost doubled.
• There are currently 1.3 billion people living in poverty, almost half of whom are children and youth.

Conclusions related to the study of the report:

• Countries have become much richer in the last forty years, but their governments have become much poorer.
• Due to the economic crisis that followed the Kovid epidemic, poverty and inequality have increased to a great extent across the world.

Implications related to Poverty (inequality):

• Poverty is not just an economic issue, but a multidimensional problem. According to the Sustainable Development Goals of the United Nations, people are forced to live in poverty not because of any one particular reason, but because of different reasons. There are many aspects of poverty like food, house, land, health.
• Actually, poverty means lack of basic ability to live with dignity, so poverty should not be considered only as an economic issue. The poor often have to do such works for their livelihood, which are dangerous to their health and their lives. They have to live in unsafe houses.
• The United Nations believes that to build a sustainable future, we must intensify our efforts to end poverty and discrimination and ensure that all people can fully enjoy their human rights.
• The theme of the International Day for the Eradication of Poverty for the year 2022-23 was 'Dignity for all'. In fact, the dignity or respect of every human being is his own fundamental right and it is necessary to protect it. But people living in poverty feel neglected and despised. They feel that they are being rejected and disrespected.
• Ending poverty and establishing peace and prosperity everywhere should be the primary goal for protecting human rights.
• The level of inequality of income and opportunities among people has increased rapidly in recent times. Every year the gap between the rich and the poor is getting wider. While the poor are getting poorer, the wealth of the billionaire class is increasing exponentially.
• Indeed, poverty and inequality are the result of wrong decisions and inaction. The rich in our society make the poor and marginalized more vulnerable and violate their fundamental rights. Factors such as social exclusion, structural discrimination and disability make life more difficult for those trapped in poverty. Apart from this, the impact of climate change disasters like drought, flood etc. also falls mostly on the poor.
• In today's world, when economic development, technical means and financial resources are being claimed to increase, it is not at all expected that crores of people of the world should live in poverty. The helpless condition of the poor in any country puts a question mark on the claims of economic development of that country.

Main causes of Poverty (Inequality):

• Rapidly growing population,
• Illiteracy and low human development,
• Ever increasing unemployment,
• Shortage of capital in the countries,
• Underdeveloped economy,
• Increase in price,
• Traditional nature of the economy,
• Lack of adequate skill development,
• Lack of development of entrepreneurship,
• Lack of proper industrialization,
• Backward social institutions,
• Corruption, lack of infrastructure,
• Unequal distribution of land and other assets and
• Vicious circle of poverty etc. are the main causes of poverty.

Poverty Status:

Internationally

• About 60 percent of the world's child labor is found in the agricultural sector because people living in poverty push their children into the labor market.
• These children are often forced to work in hazardous conditions, which adversely affects their health, education and lives.
• The gap between the schooling of women and men among the poor is more than double that of the general population.

Nationally

• According to the report released by the World Economic Forum, by 2030, there will be success in bringing about 25 million families above the poverty line in India and the share of families living below the poverty line will decrease from 15 percent to only 5 percent.
• According to the official figures of the Government of India, about 22 percent of the country's population was below the poverty line in the 2011 census. There has been a reduction in poverty in the country over time, but the rate of reduction in poverty is still slower in rural areas than in urban areas.

Initiatives of the Government for poverty alleviation:

To eradicate poverty, the government has started many schemes and programs, such as:

• National Rural Employment Program (NREP),
• National Maternity Benefit Scheme (NMBS),
• Rural Labor Employment Guarantee Program (RLEGP),
• National Family Benefit Scheme (NFBS),
• Self Employment Program for Urban Poor (SEPUP)
• MNREGA programme.

Major Challenges Before Poverty Alleviation:

• Determining the poverty line in India is a major challenge. Even now there is no such valid criteria by which the actual condition of poverty can be defined.
• At the same time resources are not available adequately for poverty alleviation.
• Due to corruption in poverty alleviation programmes, the benefits of the schemes do not reach the beneficiaries.
• Proper implementation of programs and schemes is not possible.
• The development of the country's resources is less in proportion to the ever-increasing population, due to which poverty alleviation programs also do not give expected results.

Way Forward:

• Scientific method should be adopted to determine the poverty line, so that the real poor can be identified and they can be given the benefits of government schemes.
• The rural poor consist mostly of small farmers. Alleviating their poverty and increasing food security requires improving agricultural productivity, increasing their access to resources and technology, and markets.
• Efforts should be made to reduce poverty in both rural and urban areas by encouraging local employment generation.
• By promoting poor women in the field of education, their income level can be improved.
• Helping improve security, improve livelihoods of the poor, manage risks better and enhance the health and education of their children. This will also reduce inequality among people.
• It is very important to provide healthy and balanced diet to the poor, which will not only lead to their physical and mental development, but also increase the productivity of labor.

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Mains Exam Question Explain the various implications related to poverty (inequality). Write the measures to solve the challenges related to poverty alleviation.